Counterfeiting & Piracy

Trade in Counterfeit and Pirated Goods

Apart from narcotics trafficking, counterfeiting and piracy account for the largest economic value of all forms of illicit trade. The OECD reports that counterfeiting and piracy in international trade alone has grown from US$ 250 billion annually in 2007 (OECD, 2009) to more than $461 billion in 2013, an increase of more than 80% in less than 5 years, and representing more than 2.5% of world trade (OECD & EUIPO, 2016). The widespread counterfeiting and piracy divert potential tax revenues to actors of the “underground economy”, while putting both the economy and the health and safety of consumers at risk.

Counterfeiting and piracy occur across multiple industry sectors and can extend to other and similar problems. For example, unbranded petroleum products and substandard pharmaceuticals may be considered fakes, but may not necessarily encompass an intellectual property (IP) infringement. Examples of digital illicit trade common to facilitating piracy of copyright works and live events—though storage, download and streaming—include cybercrimes and money-laundering in the financial system.

Counterfeiting and piracy activities distort marketplace competition for a wide range of sectors and both local and international brands. Other potential costs to business include:

Loss of market shares, particularly due to unfair competition practices